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Ashley Vereen
February-15-2012
Global Business
Case 1 Matsushita and Japan’s Changing Culture
Discussion Questions
1. According to some observers, the generation born after 1964 lacked the same
commitment to traditional Japanese values as their parents. They grew up in a
world that was richer, where Western ideas were beginning to make themselves felt,
and where the possibilities seemed greater. They did not want to be tied to a
company for life, to be a salary man. These trends came to the fore in the 1990s,
when the Japanese economy entered a prolonged economic slump. As the decade
progressed, one Japanese firm after another was forced to change its traditional
ways of doing business. At first troubles companies started to lay off older workers,
effectively abandoning lifetime employment guarantees. As younger people saw
this happening, they concluded that loyalty to a company might not be
reciprocated, effectively undermining one of the central bargains made in postwar
Japan.
2. Matsushita changed the pay scheme for its 11,000 managers. In the past, the
traditional twice a year bonuses had been based almost entirely on seniority, but
now Matsushita said they would be based on performance. In 1999, Matsushita
announced this process would be made transparent; managers would be shown
what their performance ranking were and how these fed into pay bonuses.
Matsushita represented the beginning of a revolution in human resource practices.
3. Matsushita took aim at the lifetime employment system and the associated perks.
Under the new system, recruits were given the choice of three employment options.
Sign a traditional option, employees could forgo the guaranteed retirement bonus in
